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Notes To The
Financial Statements
As at 31 March 2019
2.
Significant accounting policies (cont’d.)
2.3 Summary of significant accounting policies (cont’d.)
(a) Basis of consolidation (cont’d.)
When the Company has less than a majority of the voting rights of an investee, the Company
considers the following in assessing whether or not the Company’s voting rights in an investee are
sufficient to give it power over the investee: (cont’d.)
(iii) Rights arising from other contractual arrangements; and
(iv) Any additional facts and circumstances that indicate that the Company has, or does not have,
the current ability to direct the relevant activities at the time that decisions need to be made,
including voting patterns at previous shareholders’ meetings.
Subsidiary companies are consolidated when the Company obtains control over the subsidiary
company and ceases when the Company loses control of the subsidiary company. All intra-
group balances, income and expenses and unrealised gains and losses resulting from intra-group
transactions are eliminated in full.
Losses within a subsidiary company are attributed to the non-controlling interests even if that results
in a deficit balance.
Changes in the Group’s ownership interests in subsidiary companies that do not result in the Group
losing control over the subsidiaries are accounted for as equity transactions. The carrying amounts
of the Group’s interests and the non-controlling interests are adjusted to reflect the changes in their
relative interests in the subsidiary company. The resulting difference is recognised directly in equity
and attributed to owners of the Company.
When the Group loses control of a subsidiary company, a gain or loss calculated as the difference
between (i) the aggregate of the fair value of the consideration received and the fair value of any
retained interest and (ii) the previous carrying amount of the assets and liabilities of the subsidiary
company and any non-controlling interest, is recognised in profit or loss. The subsidiary company’s
cumulative gain or loss which has been recognised in other comprehensive income and accumulated
in equity are reclassified to profit or loss or where applicable, transferred directly to retained earnings.
The fair value of any investment retained in the former subsidiary company at the date control is lost
is regarded as the cost on initial recognition of the investment.
Business combinations
Acquisitions of subsidiaries are accounted for using the acquisition method. The cost of an
acquisition is measured as the aggregate of the consideration transferred, measured at acquisition
date fair value and the amount of any non-controlling interests in the acquiree. The Group elects on
a transaction-by-transaction basis whether to measure the non-controlling interests in the acquiree
either at fair value or at the proportionate share of the acquiree’s identifiable net assets. Transaction
costs incurred are expensed off and included in administrative expenses.
114
Fima Corporation Berhad
(21185-P)
Annual Report 2019